Obama to sign jobless benefit extension today

Congress OKs unemployment, homebuyer tax credit expansion

Deb Price / Detroit News Washington Bureau

Washington -- President Barack Obama is expected to sign into law today a bill that extends unemployment benefits for workers in Michigan and other hard-hit states as well as expands a popular tax credit that could boost home sales.

The bill is good news for the tens of thousands of jobless who have run out of benefits or face losing them before the end of the year. But they'll likely have to wait until mid-December before they can cash their first check.

The delay is the result of bureaucratic snarls at the Labor Department, plus bookkeeping challenges at the state unemployment agency. On top of that are two short workweeks because of Veterans Day and Thanksgiving.

The housing program was scheduled to expire at the end of November, but the House vote Thursday extends it into the spring -- and expands it to many people who own homes.

The jobless benefits extension "took too long, but this sure is going to make a difference," said Tom Clementson of Indian River, who cashed his last unemployment check in August.

"At least now the grandson will have some Christmas. And we can catch up on some bills," added the unemployed road construction worker.

The measure the House passed 403-12 extends for 14 weeks of additional benefits to all states, plus six extra weeks to states with unemployment rates of at least 8.5 percent. Michigan's is 15.3 percent -- the highest in the nation.

Overall, 600,000 jobless Americans have cashed their last unemployment check. About 100,000 Michiganians are expected to exhaust their benefits by the end of December, a couple of weeks after the Michigan Unemployment Insurance Agency says it could begin sending out checks under the latest extension.

With enactment, the jobless in the hardest-hit states could receive up to 99 weeks of benefits, which would well exceed the previous record of 65 during the 1970s. Michigan offers up to $387 per week through debit cards or direct deposit into an account.

The state will check its database of up to 80,000 workers who have exhausted their benefits and determine who qualifies, said Norm Isotalo, spokesman for the state unemployment agency.

Those who do will receive instructions in the mail about how to show they are still out of work and seeking work.

Those who would not qualify include workers who found employment after exhausting benefits and then quit or were fired from their jobs, Isotalo said.

Michiganians who have exhausted or who will exhaust the earlier benefits programs (totaling 79 weeks in the state) by Dec. 31 would qualify for the 20 weeks of newly passed extra benefits.

One strange twist: Because there are so few weeks before the end of the year, Congress will have to, as is expected, pass separate legislation to extend the Dec. 31 deadline for the underlying emergency benefits program so workers can get the six extra weeks.

"I expect Congress will take up and pass the necessary legislation in the near future," said Rep. Sander Levin, D-Royal Oak, a senior member of the House Ways and Means Committee, which oversees the issue.

Those out-of-work residents who haven't exhausted available benefits before the end of the year will not qualify for any of the 20 weeks until Congress extends the Dec. 31 deadline.

Without that step by Congress, starting Jan.1, newly jobless workers in Michigan would qualify for only the standard 26 weeks and a 13-week extended benefit; all federal emergency benefits will have expired.

Under the homebuyer tax credit, first-time homebuyers have been getting tax credits of up to $8,000 since January as part of the economic stimulus package.

In the bill passed Thursday, buyers who have owned their homes at least five years would be eligible, subject to income limits, for tax credits of up to $6,500. First-time homebuyers -- or people who haven't owned homes in the previous three years -- could get up to $8,000. To qualify, buyers must sign purchase agreements before May 1, close before July 1.

The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

About 1.4 million first-time homebuyers had qualified for the credit through August. Realtors estimate that 350,000 of those buyers would not have purchased their homes without the credit.

dprice@detnews.com (202) 662-8736 Associated Press contributed.